U.S. and NE Oklahoma Economic and housing data and forecast for the rest of 2015.
Data from NAR’s Chief economist, Lawrence Yun
and the NE Oklahoma board of Realtors and MLS
GDP for the rest of 2015 will pick up in the 2nd ½ of the year but only 2.1 percent, good but not great.
Lower Gas prices will increase consumer spending about 3%
Nationally and locally, construction spending increased 6% in the 1st ½ of 2015 and should increase at an even faster pace the last 6 months of 2015.
2.5 million NET jobs should be created in the U.S. during 2015.
There is a national housing shortage. Prior to 5 years ago there were around 1.5 million new units being built each year. Since then only around 750,000 homes have been built each year. We may not see 1.5 million units again until 2017.
Most foreclosures (the Shadow Inventory) have been sold. Foreclosures now make up less than 10% of national sales and continue to fall.
Historically low interest rates (3% range) have made owning a home very affordable. This may change soon and quickly. Demand is forcing home prices up (not so much in the Grand Lake area) and interest rate increases will make payments increase substantially. Example: $200,000 loan at 3.5% for 30 years is $898 P&I. At 6% this payment would be $1199.
Nationally Home prices are increasing faster the wage earners incomes.
*What does this all mean? Existing and new home sales will continue to rise. Thee will be 5.5 million home sales in 2015, a 7% increase from 2014. Home sales are still 25% below sales prior to the 2004-2006 periods.
What’s happening in the Grand Lake, Oklahoma area.
Home sales YTD from 2014 to 2015 are down 1%
Pending sales (homes under contract) are down 1.3% from 2014
Total listings available to sell are down 3% from the same period in 2014. (good news for future prices)
The average sales price of homes sold in the 1st 3 quarters of 2015 compared to 2014 are down 6.12%. $160,949 compared to $171,443 last year.
There is over a year’s inventory of homes in the Grand Lake area assuming no new listings were added to the market. This is more than double what major metro areas have in the 4-States.
Average days on the market stayed at the 6 month level. This is four times the average time on the market of a Wichita, KS home.
The average sold to list ratio dropped substantially last month. August saw the highest level for 2015 at 92.8% of value but September sales dropped to 86% of last listed price. This is also indicative of the end of the summer selling season at the lake.
*All in all the market is stable in the Grand Lake area. Well priced and updated homes are selling but not any faster than they have for the last two years. Prices have not really increased since the 2007-2008 period. In fact if the home has not been updated or is not in good repair you might see them selling for a discount compared to the go-go years in the early 2000’s.
Report prepared October, 2015 by Wayne Short, CRB, CRS, MBA with RE/MAX Grand Lake